Investor Relations Agnico -Eagle Reports Second Quarter 2011 Results ; Provides Exploration Update on Goldex and Kittila ; Announces Strategic Investment in Rubicon Minerals Corporation
Stock Symbol: AEM (NYSE and TSX) For further information:
Investor Relations (416) 947-1212
(All amounts expressed in U.S. dollars unless otherwise noted)
AGNICO-EAGLE REPORTS SECOND QUARTER 2011 RESULTS;
PROVIDES EXPLORATION UPDATE ON GOLDEX AND KITTILA;
ANNOUNCES STRATEGIC INVESTMENT IN RUBICON MINERALS CORPORATION
Toronto (July 27, 2011) – Agnico-Eagle Mines Limited ("Agnico-Eagle" or the “Company”) today reported quarterly net income of $68.8 million, or $0.41 per share for the second quarter of 2011. This result includes a non-cash foreign currency translation loss of $2.7 million, or $0.02 per share and stock option expense of $8.3 million, or $0.05 per share. Excluding these items would result in adjusted net income of $79.4 million, or $0.47 per share. In the second quarter of 2010, the Company reported net income of $100.4 million, or $0.64 per share.
The lower net income in 2011 was largely due to a return to normal levels of tax expense and a foreign currency translation loss versus a large tax recovery and a large foreign currency translation gain in the second quarter of 2010.
Second quarter 2011 cash provided by operating activities was $162.8 million ($161.7 million before changes in non-cash components of working capital), up from cash provided by operating activities of $161.6 million in the second quarter of 2010 ($138.9 million before changes in non-cash components of working capital).
The higher cash provided by operating activities in 2011 was primarily due to a 25% higher realized gold price and significantly higher byproduct metal prices when compared to those realized in the second quarter of 2010.
“With the installation of the permanent secondary crusher at Meadowbank, we have seen a significant improvement in our production rates. Steady state throughput is now allowing us to focus on cost cutting through optimization. The Company expects to deliver a strong second half operationally, with gold production anticipated to increase approximately 20% over the first half of 2011”, said Sean Boyd, Vice-Chairman and Chief Executive Officer. “Overall, our corporate strategy, which created significant value over the past five years, remains unchanged. Over the next several quarters, we expect to be able to lay out a new plan which will keep Agnico-Eagle at the forefront of growth in the gold industry. To that end, we have made a C$70 million strategic investment in Rubicon Minerals today, and also plan to enter into a technical services agreement to help advance their high grade Phoenix deposit in Red Lake, Ontario”, added Mr. Boyd.
Second quarter 2011 highlights include:
- Strong Cash Generation – quarterly cash provided by operating activities of $163 million, or $0.96 per share
- Record gold production at Pinos Altos – 51, 066 ounces at $299 total cash costs per ounce
- Secondary Crusher Operating at Meadowbank – installation complete in June. Mill operating at approximately 9,250 tonnes per day in July
- One of the Best Drillholes from Kittila’s Rimpi Zone - Hole RIE-11-008 returned 7.1 grams per tonne gold over 21.0 metres true width at 850 metres below surface, approximately 200 metres below the current resource envelope
- Gold Mineralization Extended at Goldex’s D Zone – Intersection of 3.0 grams per tonne gold over 117.0 metres core length at 1,100 metres depth confirms similarity of D Zone to current Goldex orebody
Payable gold production1 in the second quarter of 2011 was 239,328 ounces compared to 257,728 ounces in the second quarter of 2010. A description of the production and cost performance for each mine is set out further below.
The lower level of production in the 2011 period was largely due to issues in April relating to the March 2011 fire at the Meadowbank mine and also due to higher than expected levels of dilution in its pit during the second quarter of 2011.
Total cash costs for the second quarter of 2011 were $565 per ounce2. This compares with $482 per ounce in the second quarter of 2010. The higher cost in 2011 was largely attributable to the issues at Meadowbank that more than offset the positive impact of higher byproduct metals prices. Additionally, higher than expected costs have persisted at Kittila as two shutdowns for maintenance on the autoclave (one unplanned), higher fuel and electricity prices and high levels of labour expense (as the mine transitions from contractor to self mining), offset increased gold production.
For the first six months of 2011, the Company produced 491,690 ounces of gold at total cash costs per ounce of $548. This compares with the first half of 2010 when gold production was 445,960 ounces at total cash costs of $464 per ounce. The higher gold production in 2011 is mainly due to stronger performances from Kittila (much higher mill recoveries following a process breakthrough) and Pinos Altos (much higher mill throughput following the installation of two more tailings filters). The higher total cash costs are largely a result of high costs at Meadowbank and Kittila, as previously discussed.
As announced in the June 27, 2011 news release, Agnico-Eagle expects production of approximately 1.08 million ounces of gold for the full year 2011 at total cash costs per ounce of approximately $495.
Second Quarter 2011 Results Conference Call and Webcast Tomorrow
The Company’s senior management will host a conference call on Thursday, July 28, 2011 at 11:00 AM (E.D.T.) to discuss financial results and provide an update of the Company’s exploration and development activities.
1 Payable production of a mineral means the quantity of mineral produced during a period contained in products that are sold by the Company whether such products are shipped during the period or held as inventory at the end of the period.
2 Total cash costs per ounce is a non-GAAP measure. For a reconciliation to production costs, see Note 1 to the financial statements. See also “Note Regarding Certain Measures of Performance”.
Via Webcast:
A live audio webcast of the meeting will be available on the Company’s website homepage at www.agnico-eagle.com.
Via Telephone:
For those preferring to listen by telephone, please dial 416-644-3416 or Toll-free 800- 814-4861. To ensure your participation, please call approximately five minutes prior to the scheduled start of the call.
Replay archive:
Please dial 416-640-1917 or Toll-free 877-289-8525, access code 4403802#.
The conference call replay will expire on August 28, 2011.
The webcast along with presentation slides will be archived for 180 days on the website.
Cash Position Remains Strong
Cash and cash equivalents increased to $139.0 million at June 30, 2011, up from the March 31, 2011 balance of $114.8 million.
Capital expenditures in the second quarter of 2011 were $114.4 million, including $31.1 million at Meadowbank, $22.6 million at LaRonde, $18.9 million at Kittila, $14.3 million on Goldex, $9.7 million at Pinos Altos and $4.4 million at Lapa.
Full year 2011 capital expenditures are expected to total $423 million, up from the December 15, 2010 estimate of $313 million. Major components of the increase include:
- The impact of foreign exchange movements - $25 million
- Change in dyke design at Meadowbank - $21 million
- Soil settlement remediation at Goldex - $19 million
The remaining amounts are largely accelerated capital previously expected to be spent in 2012 and amounts relating to the Meadowbank fire (of which approximately $10 million may be recovered through insurance).
With its current cash balances, anticipated cash flows and available bank lines, management believes that Agnico-Eagle remains fully funded for the development and exploration of its current pipeline of gold projects in Canada, Finland, Mexico and the USA.
Available bank lines as of June 30, 2011 were approximately $1.2 billion.
Agnico-Eagle today agreed to invest C$70 million in the common shares of Rubicon Minerals Corporation (“Rubicon”) in a non-brokered private placement. As a result of the transaction, Agnico-Eagle will own 21,671,827 shares of Rubicon, or approximately 9.2% of the basic shares outstanding. Additionally, the Company plans to enter into a technical services agreement with the goal of advancing Rubicon’s Phoenix gold project in Red Lake, Ontario.
LaRonde Mine – Strong Cash Flow Generation Continues
The 100% owned LaRonde mine in northwestern Quebec, Canada, began operation in 1988. Overall, proven and probable gold reserves at LaRonde contain approximately 4.8 million ounces from 34.7 million tonnes grading 4.3 grams per tonne (“g/t”).
The LaRonde mill processed an average of 6,587 tonnes per day (“tpd”) in the second quarter of 2011, compared with an average of 7,254 tpd in the corresponding period of 2010. The lower throughput was largely due to a planned five day maintenance shutdown and also due to an unplanned slowdown due to the declaration of force majeure by the mine’s cyanide supplier. While the supply contract remains under force majeure, alternative suppliers have been contracted and the mine is no longer impacted.
Minesite costs per tonne3 were approximately C$84 in the second quarter of 2011. These costs are higher than the C$79 per tonne experienced in the second quarter of 2010. The increase is largely due to the 9% lower throughput in 2011, as discussed above.
On a per ounce basis, net of byproduct credits, LaRonde’s total cash costs per ounce were $231 in the second quarter of 2011 on production of 27,525 ounces of gold. This compares with the second quarter of 2010 when total cash costs per ounce were $270 on production of 41,533 ounces of gold. The decrease in total cash costs is largely due to significantly higher byproduct metal prices which more than offset lower byproduct metal production. The lower gold production in the 2011 period is largely related to planned mining of lower grade areas for much of the year and also due to lower second quarter throughput, as discussed above. Higher grades are scheduled for the fourth quarter of 2011 with the first production of the higher grade LaRonde Extension.
Considering currently high byproduct metals prices, the mine is expected to maximize the contribution of its zinc and silver ores. This may extend the mine’s life and benefit the total cash cost per ounce.
Post-2011, LaRonde is expected to ramp up to an average life of mine production of 338,000 ounces of gold per year, reflecting the higher gold grades at depth.
Goldex Mine – Low Cost Underground Mine
The 100% owned Goldex mine in northwestern Quebec began operation in 2008. Proven and probable gold reserves total 1.6 million ounces from 27.8 million tonnes grading 1.8 g/t.
The Goldex mill processed an average of 8,448 tpd in the second quarter of 2011. During the second quarter of 2010, the plant processed 7,327 tpd. The mill has now demonstrated that it can sustain approximately 8,000 tonnes per day following the installation of a permanent secondary crusher and additional tailings pump capacity in the first quarter of 2010.
3 Minesite costs per tonne is a non-GAAP measure. For reconciliation of this measure to production costs, as reported in the financial statements, see Note 1 to the financial statements at the end of this news release.
Minesite costs per tonne at Goldex were approximately C$20 in the second quarter of 2011, lower than the C$24 incurred in the second quarter of 2010. These lower unit costs were largely related to the 15% higher throughput in the mill.
Payable gold production in the second quarter of 2011 was 41,998 ounces at total cash costs per ounce of $385. This compares to second quarter 2010 gold production of 48,334 ounces at total cash costs per ounce of $325. The decrease in gold production is due to the mining of lower grade material during the 2011 period which also negatively impacted the total cash costs per ounce. The higher total cash costs are largely due to the lower gold production.
Grouting of a shear zone is underway to reduce the water inflow to the underground mine. This water flow has caused soil settlement issues at the minesite as previously saturated soils around the minesite are draining. However, flow rates have been controlled as remediation continues.
Goldex’s D Zone Continues to Grow
Ongoing exploration at Goldex has resulted in significant success from the D Zone, the large mineralized body directly below the current mining operation. The initial gold resource at the D Zone is 14.4 million tonnes grading 1.62 g/t in the inferred category (or 746,000 ounces of gold), as of December 31, 2010.
Incorporating recent results, the top of the D Zone is now approximately 840 metres below surface, and it has been traced to a depth of 1,350 metres below surface. The zone is estimated to be approximately 350 metres wide and between 60 metres and 120 metres thick, as shown on the linked Goldex longitudinal section.
[Goldex – Composite Longitudinal section] Link to image
The present dimensions and grade of the D Zone appear to be similar to the Goldex orebody.
The 2011 exploration program at Goldex includes a 300-metre exploration ramp and 12,000 metres of drilling from the ramp. Ramp construction began in April 2011 and should be completed by the end of this year. Drilling from the ramp is expected to begin in the third quarter.
Drilling in 2011 has located mineralization outside of the resource envelope and the deposit remains open at depth. Twenty-one holes (11,272 metres) were drilled in the D Zone during the second quarter. Selected results are shown in the table below, with the pierce points of these drill holes shown on the longitudinal section for the Goldex Mine.
Significant recent Goldex D Zone drill results
| Drill Hole | Zone | Purpose | From (metres) | To (metres) | Core length* (metres) | Gold grade (g/t) (uncut) |
|---|---|---|---|---|---|---|
| 73-426 | D | exploration | 496.5 | 613.5 | 117.0 | 3.02 |
| 73-427 | D | exploration | 525.0 | 637.5 | 112.5 | 1.84 |
| 73-429 | D | exploration | 634.5 | 711.0 | 76.5 | 1.48 |
| 84-023 | D | exploration | 285.0 | 463.5 | 178.5 | 1.32 |
| incl | D | 394.5 | 463.5 | 69.0 | 1.70 | |
| 84-067 | D | exploration | 337.5 | 457.5 | 120.0 | 1.50 |
| incl | D | 337.5 | 399.0 | 61.5 | 2.40 | |
| 76-013** | D | exploration | 511.5 | 751.5 | 240.0 | 2.47 |
| incl | 613.5 | 733.5 | 120.0 | 3.09 | ||
| 76-014** | D | exploration | 655.5 | 847.5 | 192.0 | 2.17 |
incl 655.5 753.0 97.5 3.07 *Cannot determine true width yet, as the geometry of the D Zone not fully understood.
** Holes 76-013 and 76-014 were previously released in the April 28, 2011 press release.
Several recent holes confirm the strong continuity of mineralization within the resource envelope. Hole 73-426 intersected 117.0 metres core length grading 3.0 g/t gold, which is one of the highest grade intercepts in the D Zone. Hole 73-427 intersected 112.5 metres grading 1.8 g/t gold at 1,056 metres below surface, showing broad mineralization up to the western limit of the zone.
Three recent holes located thick mineralization outside of the current D Zone resource envelope, some with grades higher than those from past holes within the D Zone. Twentyfive metres east of the current resource, hole 84-067 had an intercept of 61.5 metres grading 2.4 g/t gold at 1,115 metres depth. Hole 73-429, 70 metres west of the current resource, at 1,170 metres depth returned 76.5 metres of core length grading 1.5 g/t gold. Holes 76-013 and 76-014, which were previously released, showed that the mineralization continues below the current resource envelope in thick widths and higher grade.
The success of the exploration program to date has the potential to significantly increase the reserves and mine life at Goldex. The Company is considering extending the underground ramp beyond the currently planned 300 metres to provide additional drill platforms. The Company will also conduct a preliminary assessment during the second half of 2011 regarding the viability of mining the D Zone and to guide exploration in 2012.
Kittila Mine – Cost Reduction the Focus
The 100% owned Kittila mine in northern Finland achieved commercial production in May 2009. Proven and probable gold reserves total approximately 4.9 million ounces from 32.7 million tonnes grading 4.6 g/t.
The Kittila mill processed an average of 2,561 tpd in the second quarter of 2011 as compared to its 3,000 tpd design rate. In the second quarter of 2010, the Kittila mill processed 2,412 tpd. The mill throughput was below design rate largely due to two maintenance shutdowns (totaled 15 days) for work on the autoclave. The mine is systematically upgrading and modifying the agitator mechanisms to reduce the possibility of future failures. The mill has been operating normally at approximately 3,200 tpd and recoveries have averaged 83% since the repairs were completed on June 14th.
Gold recoveries in the second quarter of 2011 were 82.7%, essentially at the design rate of 83%. This compares with the second quarter of 2010 when the recoveries were approximately 68%. This improvement in mill recovery was largely due to a change in the process that improved the feed to the autoclave.
Minesite costs per tonne at Kittila were approximately €79 in the second quarter of 2011, compared to €64 in the second quarter of 2010. The increase in minesite costs was largely due to low mill availability and mill production because of unplanned maintenance shutdowns and a significant draw-down of the ore stockpile due to a slowdown in mining of the Suuri pit during remediation of the east wall (the Suuri pit is back to normal operations). Additionally, the minesite costs were high due industry-wide cost pressure on items such as fuel and electricity costs, material costs underground and high contractor costs.
Now that the mine is operating at steady state, the focus going forward will be on reducing the minesite costs. Changes in the mining operation and some specific measures that are expected to contribute to lower costs going forward include:
- mill efficiencies and increased throughput
- eliminating or significantly decreasing the use of contractors
- other optimization and efficiencies
These factors and initiatives are expected to reduce the ongoing minesite cost per tonne at Kittila between €10 and €20 in the next twelve months.
Second quarter 2011 gold production at Kittila was 30,811 ounces with a total cash cost per ounce of $850. In the second quarter of 2010 the mine produced 31,593 ounces at total cash costs per ounce of $607. The lower gold production and higher costs were largely the result of lower throughput in the second quarter of 2011 combined with the cost issues mentioned above. Total cash costs per ounce were also unfavorably impacted by a weaker US dollar (USD per Euro of 1.27 in Q2 2010 vs 1.44 in Q2 2011)
Drill Intersections Continue to Indicate Reserve Growth
Recent exploration drilling at Kittila has resulted in one of the best intercepts ever reported from the property, showing that the Rimpi zone could become a significant source of gold reserves in the future.
Hole RIE-11-008 returned 7.1 g/t gold over 21.0 metres true width at 850 metres below surface. This hole is located approximately 200 metres beneath the current resource envelope at Rimpi and approximately 1.4 kilometres north of the current resource envelope at this depth. The Rimpi deposit is open at depth and along strike. Other drilling such as holes RIM-10-003B, RIM-10-009 and RIM-10-010 show that the Rimpi Zone continues to grow at shallower depths as well. The focus of the exploration program at Rimpi for the rest of the year will be to continue to define and expand this zone of high grade mineralization.
Rimpi - Deep Drill Results
| Drill Hole | Lens | Purpose | From (metres) | To (metres) | Estimated True Width (metres) | Gold (g/t) (uncut*) |
|---|---|---|---|---|---|---|
| RIM-10-003B | Rimpi South | exploration | 679 | 685 | 4.0 | 3.64 |
| RIM-10-010 | Rimpi South | conversion | 606 | 615.2 | 6.2 | 9.93 |
| RIM-100-09 | Rimpi South | conversion | 474 | 485 | 5.7 | 6.28 |
| RIE-110-08 | Rimpi | exploration | 909 | 916 | 4.1 | 3.23 |
| and | 949 | 1007 | 21.0 | 7.10 |
*Note: all drill results at Kittila are reported as uncut gold grades [Kittila long section] Link to image
Recently, there are also strong drill results within and nearby the Roura resources, including hole ROU-09-002F that yielded 9.3 g/t gold over 11.2 metres, and hole ROU-10-036D that yielded 6.0 g/t gold over 7.8 metres. These results are expected to increase the mineral resources from Kittila.
Roura Drill Results
| Drill Hole | Lens | Purpose | From (metres) | To (metres) | Estimated True Width (metres) | Gold (g/t) (uncut) |
|---|---|---|---|---|---|---|
| ROU-09-002F | Roura Central | exploration | 697 | 719 | 11.2 | 9.32 |
| and | Roura Central | 756 | 768 | 6.2 | 3.47 | |
| ROU-100-36D | Roura North | exploration | 1074 | 1091 | 7.8 | 5.98 |
The Kittila exploration program will be accelerated with the addition of a 2,400-metre exploration ramp built over a three-year period from the Suuri zone to the Roura zone between 500 metres and 800 metres depth. This ramp will improve access for deep drilling in the Suuri, Roura and Rimpi zones. Underground ramp development began in early April and drilling from the ramp is expected to begin later this year.
A feasibility study regarding a 50% increase in mill throughput at Kittila is expected to be reviewed in the fourth quarter of 2011. The exploration results from the first half of 2011, particularly the downward extension of the Rimpi zone, could enhance the economics for the study. With the continued success expanding the mineralization to the north and at depth, the Company is already considering a second expansion, likely involving the sinking of a shaft. This study for this expansion opportunity is expected to begin in 2012.
Lapa – Record Quarterly Throughput
The 100% owned Lapa mine in northwestern Quebec achieved commercial production in May 2009. Proven and probable gold reserves total approximately 0.7 million ounces from 2.8 million tonnes grading 7.4 g/t.
The Lapa circuit at the LaRonde mill processed an average of 1,763 tpd, a quarterly record, in the second quarter of 2011. This compares with an average of 1,523 tonnes per day in the second quarter of 2010 as Lapa continues to exceed its design throughput of 1,500 tpd.
Minesite costs per tonne were C$102 in the second quarter of 2011, compared to C$118 in the second quarter of 2010. The lower cost is largely due to the increased throughput, as discussed above.
Payable production in the second quarter of 2011 was 28,552 ounces of gold at total cash costs per ounce of $599. This compares with the second quarter of 2010, when production was 28,927 ounces of gold at total cash costs per ounce of $545. The decrease in gold production and increase in costs is largely due to the decrease in grade, partly offset by the increase in mill throughput. The lower grade was largely due to lower grades in the 2011 mineral reserve model. The lower grades in the model largely reflect a higher gold price and therefore a lower cut off grade for reserves (reserve grade dropped to 7.4 g/t for year-end 2010 versus 8.2 g/t for year-end 2009).
Pinos Altos – Record Gold Production at Low Costs
The 100% owned Pinos Altos mine in northern Mexico achieved commercial production in November 2009. Proven and probable reserves, including the stand-alone, heap leach, Creston Mascota mine, total 3.3 million ounces of gold and 92.0 million ounces of silver from 44.2 million tonnes grading 2.3 g/t gold and 64.8 g/t silver.
The Pinos Altos mill processed an average of 4,711 tpd in the second quarter of 2011. This compares favourably with 3,575 tonnes per day in the second quarter of 2010. The mill is now routinely performing at process rates above the initial design capacity of 4,000 tpd following the installation of two additional tailings filters in the third quarter of 2010.
Minesite costs per tonne were $28 in the second quarter of 2011, compared to $28 in the second quarter of 2010.
Payable production in the second quarter of 2011 was a record 51,066 ounces of gold at total cash costs per ounce of $299, including the satellite Creston Mascota operation. This compares with production of 29,665 ounces at a total cash cost of $365 in the second quarter of 2010. The higher gold production and lower costs are largely due to the inclusion of Creston Mascota and the increased mill throughput.
The first gold production from Creston Mascota occurred during the fourth quarter of 2010. In the second quarter of 2011, payable gold production from this heap leach operation was 9,449 ounces (included in the Pinos Altos total above). Commercial production at Creston Mascota was achieved on March 1, 2011.
Due to the improved mill capacity and the increased underground ore reserve tonnage at Pinos Altos, the Company is evaluating alternatives with respect to increasing the underground mine capacity either through an additional production ramp or via a production shaft. The study is expected to be completed near the end of 2011.
Meadowbank – Permanent Secondary Crusher Now Operating
The 100% owned Meadowbank mine is located in the Nunavut Territory in northern Canada. Proven and probable gold reserves total 3.5 million ounces from 34.1 million tonnes grading 3.2 g/t. An additional 9.1 million tonnes grading 1.0 g/t (or 0.3 million ounces) of indicated gold resources are within the currently contemplated pit limits.
The Meadowbank mill processed an average of 7,332 tpd in the second quarter of 2011 despite the March 2011 fire which impacted operations through April. This compares with the second quarter of 2010 when the mine processed approximately 6,262 tpd. The increase in throughput was largely due to the fact that the second quarter of 2010 was the mine’s first full quarter of production and it was still undergoing normal ramp up at that time.
Minesite costs per tonne were C$81 in the second quarter of 2011 as compared to the second quarter of 2010 when minesite costs per tonne were C$94. The lower costs in the 2011 period are largely due to the increase in the mill throughput and increased productivity in the pit.
Payable production in the second quarter of 2011 was 59,376 ounces of gold at total cash costs per ounce of gold of $910. This compares with payable production of 77,676 ounces at total cash costs of $663 per ounce in the second quarter of 2010. The decrease in gold ounces and increase in cost was largely due to the mining of 34% lower grades in the 2011 period. Part of the reason for lower grades was the scheduled mining of lower grade mining blocks, but also partly due to dilution issues identified during the second quarter of 2011.
These costs are expected to decline dramatically in 2011 as throughput has improved significantly with the installation of the permanent secondary crusher in June, 2011. The design rate of 8,500 tpd is expected to be achieved on a steady state basis going forward. In fact, to date in July the mill has averaged 9,257 tpd at head grades of 3.08 g/t (reserve grade of 3.2 g/t) and costs have declined accordingly.
Additionally, changes to the blasting techniques have already improved the dilution situation at the mine. While it is still early, significant improvement in blast displacement has been observed. As a result, actual grades are currently closer to what was predicted in the reserve model. Further refinement of blasting procedures and reconciliation is ongoing.
Dividend Record and Payment Dates for the Remainder of 2011
| Record Date | Payment Date |
| September 1 | September 15 |
| December 1 | December 15 |
Dividend Reinvestment Program
Please follow the link below for information on the Company’s dividend reinvestment program.
DividendReinvestmentPlan
About Agnico-Eagle
Agnico-Eagle is a long established, Canadian headquartered, gold producer with operations located in Canada, Finland and Mexico, and exploration and development activities in Canada, Finland, Mexico and the United States. The Company has full exposure to higher gold prices consistent with its policy of no forward gold sales and maintains a corporate strategy based on increasing shareholder’s exposure to gold, on a per share basis. It has paid a cash dividend for 29 consecutive years. www.agnico-eagle.com
AGNICO-EAGLE MINES LIMITED SUMMARY OF OPERATIONS KEY PERFORMANCE INDICATORS (thousands of United States dollars, except where noted, US GAAP basis, Unaudited)
Three months ended June 30, Six months ended June 30, 2011 2010 2011 2010 Gross mine profit (exclusive of amortization shown below) (Note 1)
| LaRonde .................................................................................................... | $46,017 | $43,614 | 95,000 | $89,001 |
| Goldex ....................................................................................................... | 46,739 | 42,635 | 87,072 | 69,059 |
| Lapa .......................................................................................................... | 27,737 | 20,204 | 46,915 | 41,477 |
| Kittila ......................................................................................................... | 18,934 | 16,625 | 46,765 | 28,095 |
| Pinos Altos (Note 2) ................................................................................... | 52,568 | 22,626 | 99,827 | 35,257 |
| Meadowbank ............................................................................................. | 28,942 | 35,179 | 58,859 | 37,350 |
| Total gross mine profit ................................................................................ | 220,937 | 180,883 | 434,438 | 300,239 |
| Amortization ............................................................................................... | 59,235 | 44,003 | 121,164 | 74,506 |
| Corporate ................................................................................................... | 56,936 | 28,331 | 131,146 | 75,910 |
| Income before tax ...................................................................................... | 104,766 | 108,549 | 182,128 | 149,823 |
| Tax provision .............................................................................................. | 35,941 | 8,189 | 68,039 | 27,131 |
| Net earnings ................................................................................... | $68,825 | $100,360 | $114,089 | $122,692 |
| Net earning per share ....................................................................... | $0.41 | $0.64 | $0.68 | $0.78 |
| Operating cash flow .......................................................................... | $162,821 | $161,574 | $333,864 | $236,065 |
Realized price per sales volume (US$):
| Gold (per ounce) ..................................................................................... | $1,530 | $1,222 | $1,466 | $1,168 |
| Silver (per ounce).................................................................................... | $38.50 | $19.29 | $37.31 | $18.94 |
| Zinc (per tonne) ...................................................................................... | $2,257 | $1,890 | $2,340 | $2,057 |
| Copper (per tonne) ................................................................................. | $8,565 | $6,581 | $9,377 | $6,934 |
Payable production:
Gold (ounces)
| LaRonde ................................................................................................. | 27,525 | 41,533 | 64,418 | 86,569 |
| Goldex .................................................................................................... | 41,998 | 48,334 | 80,498 | 90,603 |
| Lapa ...................................................................................................... | 28,552 | 28,927 | 55,466 | 60,480 |
| Kittila ..................................................................................................... | 30,811 | 31,593 | 71,128 | 56,140 |
| Pinos Altos (Note 2) ............................................................................... | 51,066 | 29,665 | 99,067 | 55,893 |
| Meadowbank .......................................................................................... | 59,376 | 77,676 | 121,113 | 96,275 |
| Total gold (ounces) | 239,328 | 257,728 | 491,690 | 445,960 |
Silver (000s ounces)
| LaRonde ................................................................................................. | 736 | 860 | 1,416 | 1,735 |
| Pinos Altos (Note 2) ................................................................................ | 452 | 248 | 858 | 470 |
| Meadowbank .......................................................................................... | 13 | 12 | 26 | 14 |